The GRINCOH project focuses on two major challenges facing the Central and Eastern European Countries (CEECs):

disjuncture between fast productivity growth and a rather poor performance to develop innovative capacities to support longer-term sustainable growth and assure their competitive positions. These countries are striving to achieve international competitiveness relying more on low costs of production rather than offering innovative products and services to demanding customers. Partly as a result of this development paradigm, most CEECs were disproportionately affected by the 2008-2009 crisis. It is arguable that the CEECs are not sufficiently prepared to meet the ‘smart growth’ goals of the Europe 2020 strategy

economic, social and environmental territorial disparities are among the more pronounced outcomes of the CEECs accelerated growth. The benefits of transformation in these countries have been unequally distributed among particular social groups and territories – with the emergence of highly educated and internationally successful professionals and entrepreneurs on the one hand, but structural unemployment, persistent poverty and social exclusion on the other hand. Furthermore, regional imbalances are characterised by a process of metropolisation that has privileged a handful of dynamic urban centres while exacerbating the structural problems of old industrial regions, vast rural areas and regions located on borders, and especially the EU’s eastern borders. As different as they are in social, cultural and geographical terms, these declining regions share general problems of economic peripherality and many negative effects of structural change, such as rural de-population, ‘brain drain’, disinvestment and, frequently, below-average levels of socio-economic well-being.

This polarised economic and territorial development within CEECs poses challenges not only for the respective CEECs, but also for European cohesion.

Therefore, the overall objectives of the project are:

(a) to establish development scenarios for the CEECs for the period up to 2020 under different assumptions of political frameworks, institutional conditions and development strategies;

(b) to identify the implications for sustainable growth – based on innovation and the development of technological capabilities – and greater economic, social and territorial cohesion in the CEECs; and

(c) to advise on future policy options for the CEECs, and in particular for EU Cohesion policy.

The following issues should be represented in the policy recommendations:

relations between domestic policies of the CEE Member States and the Cohesion policy of the EU, especially in the light of better alignment of EU expenditure with the goals of Europe 2020;

the potential impacts of a reformed Cohesion policy and national policies on developing the innovative potential of the CEECs and their regions and on innovativeness of their economies, institutions and societies;

the measures contained within Cohesion policy and national and regional policies of the CEECs that foster social cohesion in terms of labour markets, justified levels of social equity, gender equity, efficient use of skills and qualifications and alleviating social exclusion (also related to ethnic differences) and social pathologies, etc.; and

economic, R&D and educational policies towards environmental protection, greener energy (and sustainable development more broadly) and growing environmental awareness of wide strata of population of the CEECs.

Thus, the project should contribute in considerable manner to policy recommendations for the CEECs so that they can achieve key objectives of the Europe 2020 strategy and its ‘flagship’ policies.